arlier, I noticed that YouTube were testing 'double mid roll ads', where two ads will be shown back to back during an interruption to your chosen video. This was shortly after the launch of YouTube Premium, their subscription video streaming offering where one of the main highlights was the removal of ads on the platform. I presumed the increase in ad frequency was an attempt to get more people to subscribe to their Premium service after being overwhelmed by disruptions to their viewing experience.
This was supported by an interview I found with Lyor Cohen, Global Head of Music at YouTube where he gave details on the companies transition to a more subscription based revenue model over advertising, which they have established themselves in. He essentially described the situation as users having to pick between paying to access ad-free content on the platform, or "paying with their eyeballs", 'suffering' through advertising disruptions. I highly recommend checking out the above post and interview within as it gave a great insight into the direction the company is heading into, among increasing competition from video streaming giants Netflix, Disney, Amazon Prime Video, HBO, etc.
Fast forward to, November 2018, where they announced they would be rolling out 'Ad Pods' across the platform. Skippable back to back ads at the start of videos. When I noticed these in August, they were appearing in the middle of videos at ad intervals, essentially just increasing frequency. With these Pods, the aim is to show more ads at the beginning of videos to satisfy both the advertisers demand for reach as well as the content creators opportunity to earn revenue from their videos.
YouTube have stated that videos where 'Ad Pods' are displayed at the beginning will have fewer interruptions over their duration. This is an attempt to increase engagement with videos, leading to longer viewing sessions - which in turn leads to them being served a higher number of ads. In essence, they realise that constant ad breaks placed within videos by creators who are looking to maximise video revenue is impacting the overall viewing experience for their large user base. They are now trying to find the tricky balance between reach, revenue and user experience.
Also, it has been recently announced that 'YouTube Originals' content that was originally locked behind the paywalls of YouTube Premium, will now be available to all users, supported by ads. Original content is supported by big budgets from YouTube, working with professional production teams and top, influential creators to produce TV-quality shows for the platform. What would happen is the first episode in the series would be free for viewers to watch, then they would have to subscribe to catch the rest of the show, hoping the improvement of quality would be enough to get people to reach into their pockets and pay for YouTube videos they've seen for free since 2005.
Unfortunately, this does not seem to have had the desired impact, granted, their budget for original content is much lower than the above mentioned competitors - in the hundreds of millions as opposed to billions Netflix are spending on it's originals each year. I guess the challenges they are facing involve the psychology of getting hundreds of millions of people who have been used to watching free content on YouTube to add the platform to their monthly direct debits. You can also factor in that there is so much video out there that can be consumed for free, that there just isn't the urgency to watch these shows.
Regardless, starting in 2019, YouTube Originals will be available to all users - those with Premium have the ability to watch uninterrupted, whilst non-subscribers will have to 'pay with their eyeballs'.
What Are Your Thoughts?
YouTube is an evolving platform, with one of the main attractions being it facilitates the distribution, audience building and potential monetisation for creatives with a camera and a vision. This has resulted in it becoming the premium environment for user generated video. The volume of traffic on the website could not be ignored by marketers, bringing advertisers to the platform to extend their reach from just traditional media to the digital space, this also enabled channels to monetise their content - subsidising production costs and ultimately providing a sustainable income.
However, the digital space has also brought forward more choice and feedback. You can now watch video on your own schedule, no need to wait for the scheduled slot like traditional broadcast TV. In addition to this, many people do not like the disruptive experience ads bring, some even resorting to using 'ad blockers' to prohibit the appearance on their devices.
You cannot avoid adverts though, they support and fund the many flows of information that exist today, but we feel that brands need to work on having their message featured into content their potential customers are directly consuming. This increases familiarity and favourability, meaning that when you do eventually reach them through media buys, they are more receptive to your brand and have prior understanding of your offerings.
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